Advice from anyone with eBay/High volume Ecommerce business
Discussion
Evening guys,
I've had an idea for a new eBay/Amazon business and I was hoping to get some advice from those with experience.
I've found a way of being able to get a range of products with in a significant product category at a cheaper price than the competition. The competition would be able to copy me however I am hoping to use the head start to gain a foothold in the market place.
I'm going through the figures to make sure the idea is viable and had a few questions for the experts;-
1. What gross and net profit margins do most successful high volume sellers work to?
2. The products are small and I am currently looking at sending as Royal Mail 2nd class large letters (using a franking machine), is there any alternative services I should be looking at?
3. Any other pitfalls of starting a new eBay business, e.g listings not ranking well, other difficulties competing with established sellers etc
If anyone has any advice it would be a massive help, thank you!
I've had an idea for a new eBay/Amazon business and I was hoping to get some advice from those with experience.
I've found a way of being able to get a range of products with in a significant product category at a cheaper price than the competition. The competition would be able to copy me however I am hoping to use the head start to gain a foothold in the market place.
I'm going through the figures to make sure the idea is viable and had a few questions for the experts;-
1. What gross and net profit margins do most successful high volume sellers work to?
2. The products are small and I am currently looking at sending as Royal Mail 2nd class large letters (using a franking machine), is there any alternative services I should be looking at?
3. Any other pitfalls of starting a new eBay business, e.g listings not ranking well, other difficulties competing with established sellers etc
If anyone has any advice it would be a massive help, thank you!
One thing to consider, especially using RM 2nd class so not tracked, is the amount of stuff that goes missing in the post - especially at this time of year...
I was maybe getting 3-4% lost or damaged, I'm now getting 8+% (last month) and raising compensation claims daily.
Covid's probably not helping and I have had a couple turn up after 2 weeks but I really need to find a tracked / cheap alternative?
You'll also soon get bored of dealing with complete idiots on eBay, non payers, order cancelers, returners etc...
I was maybe getting 3-4% lost or damaged, I'm now getting 8+% (last month) and raising compensation claims daily.
Covid's probably not helping and I have had a couple turn up after 2 weeks but I really need to find a tracked / cheap alternative?
You'll also soon get bored of dealing with complete idiots on eBay, non payers, order cancelers, returners etc...
CorradoTDI said:
One thing to consider, especially using RM 2nd class so not tracked, is the amount of stuff that goes missing in the post - especially at this time of year...
I was maybe getting 3-4% lost or damaged, I'm now getting 8+% (last month) and raising compensation claims daily.
Covid's probably not helping and I have had a couple turn up after 2 weeks but I really need to find a tracked / cheap alternative?
You'll also soon get bored of dealing with complete idiots on eBay, non payers, order cancelers, returners etc...
If you are sending in volume, the 3D barcode does provide limited tracking.I was maybe getting 3-4% lost or damaged, I'm now getting 8+% (last month) and raising compensation claims daily.
Covid's probably not helping and I have had a couple turn up after 2 weeks but I really need to find a tracked / cheap alternative?
You'll also soon get bored of dealing with complete idiots on eBay, non payers, order cancelers, returners etc...
loafer123 said:
JPJPJP said:
You need to join the dsliverpool e-commerce club
Has that started yet?www.theecommerce.club
r200mgr said:
Evening guys,
I've had an idea for a new eBay/Amazon business and I was hoping to get some advice from those with experience.
I've found a way of being able to get a range of products with in a significant product category at a cheaper price than the competition. The competition would be able to copy me however I am hoping to use the head start to gain a foothold in the market place.
I'm going through the figures to make sure the idea is viable and had a few questions for the experts;-
1. What gross and net profit margins do most successful high volume sellers work to?
2. The products are small and I am currently looking at sending as Royal Mail 2nd class large letters (using a franking machine), is there any alternative services I should be looking at?
3. Any other pitfalls of starting a new eBay business, e.g listings not ranking well, other difficulties competing with established sellers etc
If anyone has any advice it would be a massive help, thank you!
Have you considered a website and driving traffic to it using the money saved from the eBay and AMA fees??I've had an idea for a new eBay/Amazon business and I was hoping to get some advice from those with experience.
I've found a way of being able to get a range of products with in a significant product category at a cheaper price than the competition. The competition would be able to copy me however I am hoping to use the head start to gain a foothold in the market place.
I'm going through the figures to make sure the idea is viable and had a few questions for the experts;-
1. What gross and net profit margins do most successful high volume sellers work to?
2. The products are small and I am currently looking at sending as Royal Mail 2nd class large letters (using a franking machine), is there any alternative services I should be looking at?
3. Any other pitfalls of starting a new eBay business, e.g listings not ranking well, other difficulties competing with established sellers etc
If anyone has any advice it would be a massive help, thank you!
jonamv8 said:
Have you considered a website and driving traffic to it using the money saved from the eBay and AMA fees??
I need to do something quickly and feel there's too much uncertainty around marketing (which isn't my strong suit) and trying to drive traffic/gain the customers trust. The plan is to also have a website and include information with each order directing them to it for future purchases at even cheaper prices (minus the fees). Hopefully this will grow the brand and website with very little marketing cost.
I would to think I am pretty experienced in this area.
Keep it simple, for now Id look at the pounds and pence. How many items do you forecast selling daily? How much money are you going to take home from each - times it up and see if its worth doing.
i.e £10 sell, less 15% fees & admin, less £1 postage, less £5 product cost = left with £2.50 less VAT. If you can sell 150 items a day and run it from your garage then you'll have a nice little business.
eBay is not as easy as it was, it used to be very straight forward. Get a good listing going, sell a load through said listing and your listing will sit pretty at the top of the eBay best match filters taking 75% of the sales. Now any old fool can come along and "sponsor" a listing and literally buy their way in the search results. The best match algorithm now also looks at sales conversion rates, instead of overall sales. So if a new listing comes along with a cheaper price than you - everything else being equal their sales conversion rate will be better than yours and eventually they will end up taking your crown and stealing your sales.
So, whilst starting early can help give an advantage you certainly wont be untouchable.
I have no idea what items you are referring to, thus no idea about the competition and how they'd react. But for example, we have a strong position in our category and if a new seller turned up we'd drop our prices and potentially consider sponsoring listings to get on top of them. For us it would make sense to break even or even make a small loss on said lines to retain/regain control and ensure the new seller didn't get a foothold.
Again, I know nothing about the products and how you'll source. But can a competitor put their foot down and stop your supply? i.e your competitor has been trading with said manufacturer for 10years retailing their products on various channels very successfully. You come along and put a spanner in the works, whats the likely hood the other competition will be able to stamp you out?
Postage. We send several thousand parcels with the Royal Mail every single day - their delivery success rates are very good. We send the vast majority via RM48 (2D barcoded with delivery confirmation tracking.) I believe that too many sellers get hung up on parcel losses, parcels getting lost and damaged is part of ecommerce and happens with every parcel service - you have to factor it in as a cost, similar to returns. However, more often than not the savings you can make by sending items untracked can enormously outweigh the cost of replacing lost items. Do the maths on your sales volume and product costs.
Returns - have you considered this? Again not knowing the product its hard to comment. But nowadays people love a return - they cost a lot of money as more often than not the returned merch is not fit for resale. Do not ignore this, marketplaces help buyers return so you cannot avoid.
Customer Service - again this depends on the product. But do not underestimate the amount of enquiries you'll get daily. If the product is incredibly simple then hopefully you'll be limited to basic logistic related enquiries - but if there is any complexity to your products then expect a lot of comms. Although, this is true with whatever channel you sell on.
Websites. Another poster mentioned starting a site... personally I think this is a non-starter unless you have a very desirable product or USP. Everybody talks about selling through their own website and saving 10%-15% marketplaces fees. This all sounds lovely and I assume they think of Shopify sites costing £49 per month all in. However truth be told, to operate a decent website with all the bells and whistles (Trustpilot, various payment options, push notifications, email marketing integrations etc etc - you'll be paying at least 10x that monthly).
You then have the big problem of getting the people to your website - if you go down the Google PPC/PLA route you'll soon burn into or through the 10-15% the marketplace was costing you.
You can of course do the usual stick a slip in with the order to bring repeat business back to your site, but unless the product you sell requires very regular replenishment it will take a long time to build anything worthwhile.
Other random things you need to consider:
Is it scalable? What do you want out of this - to become a billionaire or take control of your working hours? How robust is your sourcing? Why aren't your competitors already doing this - what have you missed? How are you going to grow your business? Can you sell on Amazon? Does the product have a shelf life? How will you finance rapid growth if it takes off? VAT registry - will you get there quickly?
Cheers - it would be really interesting to know more about the product.
Keep it simple, for now Id look at the pounds and pence. How many items do you forecast selling daily? How much money are you going to take home from each - times it up and see if its worth doing.
i.e £10 sell, less 15% fees & admin, less £1 postage, less £5 product cost = left with £2.50 less VAT. If you can sell 150 items a day and run it from your garage then you'll have a nice little business.
eBay is not as easy as it was, it used to be very straight forward. Get a good listing going, sell a load through said listing and your listing will sit pretty at the top of the eBay best match filters taking 75% of the sales. Now any old fool can come along and "sponsor" a listing and literally buy their way in the search results. The best match algorithm now also looks at sales conversion rates, instead of overall sales. So if a new listing comes along with a cheaper price than you - everything else being equal their sales conversion rate will be better than yours and eventually they will end up taking your crown and stealing your sales.
So, whilst starting early can help give an advantage you certainly wont be untouchable.
I have no idea what items you are referring to, thus no idea about the competition and how they'd react. But for example, we have a strong position in our category and if a new seller turned up we'd drop our prices and potentially consider sponsoring listings to get on top of them. For us it would make sense to break even or even make a small loss on said lines to retain/regain control and ensure the new seller didn't get a foothold.
Again, I know nothing about the products and how you'll source. But can a competitor put their foot down and stop your supply? i.e your competitor has been trading with said manufacturer for 10years retailing their products on various channels very successfully. You come along and put a spanner in the works, whats the likely hood the other competition will be able to stamp you out?
Postage. We send several thousand parcels with the Royal Mail every single day - their delivery success rates are very good. We send the vast majority via RM48 (2D barcoded with delivery confirmation tracking.) I believe that too many sellers get hung up on parcel losses, parcels getting lost and damaged is part of ecommerce and happens with every parcel service - you have to factor it in as a cost, similar to returns. However, more often than not the savings you can make by sending items untracked can enormously outweigh the cost of replacing lost items. Do the maths on your sales volume and product costs.
Returns - have you considered this? Again not knowing the product its hard to comment. But nowadays people love a return - they cost a lot of money as more often than not the returned merch is not fit for resale. Do not ignore this, marketplaces help buyers return so you cannot avoid.
Customer Service - again this depends on the product. But do not underestimate the amount of enquiries you'll get daily. If the product is incredibly simple then hopefully you'll be limited to basic logistic related enquiries - but if there is any complexity to your products then expect a lot of comms. Although, this is true with whatever channel you sell on.
Websites. Another poster mentioned starting a site... personally I think this is a non-starter unless you have a very desirable product or USP. Everybody talks about selling through their own website and saving 10%-15% marketplaces fees. This all sounds lovely and I assume they think of Shopify sites costing £49 per month all in. However truth be told, to operate a decent website with all the bells and whistles (Trustpilot, various payment options, push notifications, email marketing integrations etc etc - you'll be paying at least 10x that monthly).
You then have the big problem of getting the people to your website - if you go down the Google PPC/PLA route you'll soon burn into or through the 10-15% the marketplace was costing you.
You can of course do the usual stick a slip in with the order to bring repeat business back to your site, but unless the product you sell requires very regular replenishment it will take a long time to build anything worthwhile.
Other random things you need to consider:
Is it scalable? What do you want out of this - to become a billionaire or take control of your working hours? How robust is your sourcing? Why aren't your competitors already doing this - what have you missed? How are you going to grow your business? Can you sell on Amazon? Does the product have a shelf life? How will you finance rapid growth if it takes off? VAT registry - will you get there quickly?
Cheers - it would be really interesting to know more about the product.
russy01 said:
I would to think I am pretty experienced in this area.
Keep it simple, for now Id look at the pounds and pence. How many items do you forecast selling daily? How much money are you going to take home from each - times it up and see if its worth doing.
i.e £10 sell, less 15% fees & admin, less £1 postage, less £5 product cost = left with £2.50 less VAT. If you can sell 150 items a day and run it from your garage then you'll have a nice little business.
eBay is not as easy as it was, it used to be very straight forward. Get a good listing going, sell a load through said listing and your listing will sit pretty at the top of the eBay best match filters taking 75% of the sales. Now any old fool can come along and "sponsor" a listing and literally buy their way in the search results. The best match algorithm now also looks at sales conversion rates, instead of overall sales. So if a new listing comes along with a cheaper price than you - everything else being equal their sales conversion rate will be better than yours and eventually they will end up taking your crown and stealing your sales.
So, whilst starting early can help give an advantage you certainly wont be untouchable.
I have no idea what items you are referring to, thus no idea about the competition and how they'd react. But for example, we have a strong position in our category and if a new seller turned up we'd drop our prices and potentially consider sponsoring listings to get on top of them. For us it would make sense to break even or even make a small loss on said lines to retain/regain control and ensure the new seller didn't get a foothold.
Again, I know nothing about the products and how you'll source. But can a competitor put their foot down and stop your supply? i.e your competitor has been trading with said manufacturer for 10years retailing their products on various channels very successfully. You come along and put a spanner in the works, whats the likely hood the other competition will be able to stamp you out?
Postage. We send several thousand parcels with the Royal Mail every single day - their delivery success rates are very good. We send the vast majority via RM48 (2D barcoded with delivery confirmation tracking.) I believe that too many sellers get hung up on parcel losses, parcels getting lost and damaged is part of ecommerce and happens with every parcel service - you have to factor it in as a cost, similar to returns. However, more often than not the savings you can make by sending items untracked can enormously outweigh the cost of replacing lost items. Do the maths on your sales volume and product costs.
Returns - have you considered this? Again not knowing the product its hard to comment. But nowadays people love a return - they cost a lot of money as more often than not the returned merch is not fit for resale. Do not ignore this, marketplaces help buyers return so you cannot avoid.
Customer Service - again this depends on the product. But do not underestimate the amount of enquiries you'll get daily. If the product is incredibly simple then hopefully you'll be limited to basic logistic related enquiries - but if there is any complexity to your products then expect a lot of comms. Although, this is true with whatever channel you sell on.
Websites. Another poster mentioned starting a site... personally I think this is a non-starter unless you have a very desirable product or USP. Everybody talks about selling through their own website and saving 10%-15% marketplaces fees. This all sounds lovely and I assume they think of Shopify sites costing £49 per month all in. However truth be told, to operate a decent website with all the bells and whistles (Trustpilot, various payment options, push notifications, email marketing integrations etc etc - you'll be paying at least 10x that monthly).
You then have the big problem of getting the people to your website - if you go down the Google PPC/PLA route you'll soon burn into or through the 10-15% the marketplace was costing you.
You can of course do the usual stick a slip in with the order to bring repeat business back to your site, but unless the product you sell requires very regular replenishment it will take a long time to build anything worthwhile.
Other random things you need to consider:
Is it scalable? What do you want out of this - to become a billionaire or take control of your working hours? How robust is your sourcing? Why aren't your competitors already doing this - what have you missed? How are you going to grow your business? Can you sell on Amazon? Does the product have a shelf life? How will you finance rapid growth if it takes off? VAT registry - will you get there quickly?
Cheers - it would be really interesting to know more about the product.
Brilliant, Email sent Keep it simple, for now Id look at the pounds and pence. How many items do you forecast selling daily? How much money are you going to take home from each - times it up and see if its worth doing.
i.e £10 sell, less 15% fees & admin, less £1 postage, less £5 product cost = left with £2.50 less VAT. If you can sell 150 items a day and run it from your garage then you'll have a nice little business.
eBay is not as easy as it was, it used to be very straight forward. Get a good listing going, sell a load through said listing and your listing will sit pretty at the top of the eBay best match filters taking 75% of the sales. Now any old fool can come along and "sponsor" a listing and literally buy their way in the search results. The best match algorithm now also looks at sales conversion rates, instead of overall sales. So if a new listing comes along with a cheaper price than you - everything else being equal their sales conversion rate will be better than yours and eventually they will end up taking your crown and stealing your sales.
So, whilst starting early can help give an advantage you certainly wont be untouchable.
I have no idea what items you are referring to, thus no idea about the competition and how they'd react. But for example, we have a strong position in our category and if a new seller turned up we'd drop our prices and potentially consider sponsoring listings to get on top of them. For us it would make sense to break even or even make a small loss on said lines to retain/regain control and ensure the new seller didn't get a foothold.
Again, I know nothing about the products and how you'll source. But can a competitor put their foot down and stop your supply? i.e your competitor has been trading with said manufacturer for 10years retailing their products on various channels very successfully. You come along and put a spanner in the works, whats the likely hood the other competition will be able to stamp you out?
Postage. We send several thousand parcels with the Royal Mail every single day - their delivery success rates are very good. We send the vast majority via RM48 (2D barcoded with delivery confirmation tracking.) I believe that too many sellers get hung up on parcel losses, parcels getting lost and damaged is part of ecommerce and happens with every parcel service - you have to factor it in as a cost, similar to returns. However, more often than not the savings you can make by sending items untracked can enormously outweigh the cost of replacing lost items. Do the maths on your sales volume and product costs.
Returns - have you considered this? Again not knowing the product its hard to comment. But nowadays people love a return - they cost a lot of money as more often than not the returned merch is not fit for resale. Do not ignore this, marketplaces help buyers return so you cannot avoid.
Customer Service - again this depends on the product. But do not underestimate the amount of enquiries you'll get daily. If the product is incredibly simple then hopefully you'll be limited to basic logistic related enquiries - but if there is any complexity to your products then expect a lot of comms. Although, this is true with whatever channel you sell on.
Websites. Another poster mentioned starting a site... personally I think this is a non-starter unless you have a very desirable product or USP. Everybody talks about selling through their own website and saving 10%-15% marketplaces fees. This all sounds lovely and I assume they think of Shopify sites costing £49 per month all in. However truth be told, to operate a decent website with all the bells and whistles (Trustpilot, various payment options, push notifications, email marketing integrations etc etc - you'll be paying at least 10x that monthly).
You then have the big problem of getting the people to your website - if you go down the Google PPC/PLA route you'll soon burn into or through the 10-15% the marketplace was costing you.
You can of course do the usual stick a slip in with the order to bring repeat business back to your site, but unless the product you sell requires very regular replenishment it will take a long time to build anything worthwhile.
Other random things you need to consider:
Is it scalable? What do you want out of this - to become a billionaire or take control of your working hours? How robust is your sourcing? Why aren't your competitors already doing this - what have you missed? How are you going to grow your business? Can you sell on Amazon? Does the product have a shelf life? How will you finance rapid growth if it takes off? VAT registry - will you get there quickly?
Cheers - it would be really interesting to know more about the product.
foliedouce said:
loafer123 said:
JPJPJP said:
You need to join the dsliverpool e-commerce club
Has that started yet?www.theecommerce.club
I’d say the first challenge is not to lose too much money, if you can avoid losing then in you are in a great place to make money.
Once you show your hand so to speak the primarily overseas competitors will attack. You need to have plan B, C and possibly D ready for that occurrence.
The main strategy prevalent atm is to report you for selling dangerous / fake items. It’s happened to several new members recently.
Happy to have a chat,
Gassing Station | Business | Top of Page | What's New | My Stuff